Heathrow say there is no evidence that any cities across the world have successfully run a split hub, or that low cost carriers, new aircraft or relocating alliances will change that.
Whilst Heathrow and others such as the Mayor of London argue the only way to solve the UK’s lack of direct connections to long-haul emerging markets is via a larger hub airport, others such as Gatwick Airport claim this is unnecessary, and that splitting demand across multiple airports would also work.
The research, written by aviation consultants JLS Consulting, looked at cities around the world to see if there was any evidence that the split solution could work. It concludes that there are no successful versions of this model.
The JLS report shows that whilst short-haul, point to point services have seen rapid growth in the UK since the late 1990s, the same has not happened with long-haul services despite there being space at non-hub airports.
Heathrow commissioned the report to see if there was any evidence the split-hub model could work in the future.
It says that there are numerous cities around the world with multiple airports but that, like London, they use those airports for different functions – and have, at most, one hub.
New York has three network carriers but, says the report, still only supports one hub airport, Newark. JLS say JFK operates as a point to point airport supported by New York’s large urban population.
Tokyo attempted to split its hub airport into two and its connectivity and economy has suffered as a result, says the report, while Paris has one hub (Charles de Gaulle) with Orly operating as a point to point airport, and Moscow has no hub and consequently poor international connectivity.
The report argues that the complexity and financial difficulties of integrating carrier schedules to make use of transfer traffic explains why there are so few hub airports in the world, let alone two competing hubs in the same city.
Colin Matthews, Heathrow’s Chief Executive, said: “This research shows that no world cities have successfully split demand across multiple hub airports. However convenient it would be to believe that London could be the first, we cannot bet the UK’s economic prosperity on wishful thinking. The UK can only benefit from improved long haul connections by building a bigger hub airport.”
The JLS study shows that low cost carriers (LCC) will not enable a second hub airport. Network airlines typically lose money when operating their short-haul feeder routes, so LCCs are unlikely to be willing to change their business models. Even when a network operator owns a LCC (eg IAG owns Vueling) it operates it as a stand-alone business, not a feeder network.
The report adds that moving an alliance to another airport would not be enough to create a second hub without a network carrier based there to make it work. It says that after the EU/US ‘Open Skies’ agreement, Air France tried a Heathrow-Los Angeles service, but they could not make the route work as it was isolated from their short-haul feed at their Paris hub base.
Finally the report says that the new powers in aviation are all basing their strategies around hub airports. Dubai’s new airport will become the single home for Emirates, Doha’s new airport will replace the old one just as Hong Kong did with its new Chep Lap Kok airport, and Istanbul is planning the same approach with its new super-hub.
The IMF forecasts that over the next ten years, the eight largest emerging markets will account for more than half of global GDP growth. It has been shown that countries trade twenty times as much with countries they have a frequent, direct flight to, so direct links to those emerging economies will be vital to the UK’s prosperity.
Heathrow and the Mayor of London both argue that the only way to support those links is through a hub airport. Hub airports use transfer passengers to support long haul routes that would not be viable with local demand alone. They agree that the size of the UK, and the fact that it only has one home carrier, BA, to supply these transfer passengers from its short haul network means we can only have one hub airport.
Where they disagree is on where that hub should be of course. The debate continues.